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johny trout is planning a $540,000 expansion to its lake. this cost will be depreciated on...

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Finance

johny trout is planning a $540,000 expansion to its lake. this costwill be depreciated on a straight line basis over a 10 year period.the lake is expected to generate $489,000 in additional annualsales. every year fixed costs are $129,400, with variable costs of$46% of sales, and a tax rate is 34%. what is the operating cashflow for the third year of this project?
a. 106,906.65
b. $107,235.60

Answer & Explanation Solved by verified expert
3.9 Ratings (365 Votes)
First list down the information provided inquestionCost of Expansion 540000Additional Annual Sales 489000Variable Cost 46 of sales ie 224940Annual Fixed Cost    See Answer
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Transcribed Image Text

johny trout is planning a $540,000 expansion to its lake. this costwill be depreciated on a straight line basis over a 10 year period.the lake is expected to generate $489,000 in additional annualsales. every year fixed costs are $129,400, with variable costs of$46% of sales, and a tax rate is 34%. what is the operating cashflow for the third year of this project?a. 106,906.65b. $107,235.60

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